London midday: Bernanke comments drive gains on FTSE 100

11th Jul 2013 11:35

A strong performance in the mining sector ensured that the FTSE 100 was trading firmly in positive territory on Thursday after dovish comments from Federal Reserve Chairman Ben Bernanke sparked gains in commodity prices."After June's sell-off in risk assets was attributed to seemingly hawkish comments from the Fed Chairman last month, the July rally has built further momentum this morning on the back of a much softer statement from the Fed Chairman after markets closed last night," said Matt Basi, Head of UK Sales Trading at CMC Markets.Minutes of the June Federal Open Market Committee (FOMC) meeting released late Wednesday night didn't reveal much new, though policymakers still appear divided on when to begin scaling back stimulus measures. The statement reiterated that downside risks to the economy had diminished and activity was picking up, but "many" members wanted to see further progress in the labour market before beginning to 'taper'.However, given that the meeting took place before the release of the release of last month's jobs stellar report, many analysts still expect a scaling back of quantitative easing (QE) by as early as September.A Q&A session with Bernanke after the markets closed saw Wall Street benchmarks gain in after-hours trading as he said that the Fed would not think about raising short-term interest rates even if the unemployment rate falls dramatically. "It may be well sometime after we hit 6.5% before rates reach any significant level," he said."The decision by Bernanke to focus more on interest rates last night sent a clear message that days of large scale asset purchases are numbered. The Fed appears more focused on damage limitation for the markets than trying to prolong the purchases for a few more months to avoid spooking investors," said Market Analyst Craig Erlam from Alpari.FTSE 100: Miners surge as metals prices jumpJumping metals prices across the board on the back of Bernanke's dovish comments sparked some big moves in the mining sector today. Gold rose 2.9%, silver was up nearly 4.0%, while copper jumped over 3.0%.Fresnillo, Vedanta, Randgold, Anglo American, Antofagasta, Rio Tinto, BHP Billiton and Glencore Xstrata were among the best performers this morning on the FTSE 100. Associated British Foods was also putting in a decent performance after total group sales rose 8.0% in the third quarter, as a strong performance from Primark offset weakness in the sugar division. The stock was boosted by an upgrade by Panmure Gordon to 'buy'.Consumer products firm Unilever advanced after saying that it has increased its stake in Hindustan Unilever from 52.48% to 67.26%, spending nearly €2.5bn.easyJet was flying lower despite shareholders voting in favour of an order for 135 Airbus planes valued at $13bn, a transaction that has drawn fierce criticism from founder and major shareholder Stelios Haji-Ioannou.FTSE 250: Ashmore, Hays provide a liftFund manager Ashmore was higher despite reporting that assets under management during the final quarter were unchanged from the same time a year earlier as market conditions turned more challenging towards the end of the period.Recruitment firm Hays also gained after reporting an increase in final-quarter net fees. While it expects fragile and mixed conditions to continue, the firm said it is confident full year operating profit will be at the top of the current range of market estimates.Heading the other way was price comparison site Moneysupermarket.com which revealed slower trading in the second quarter due to ever-changing Google algorithms.Second-tier miners were performing in line with their FTSE 100 counterparts, with African Barrick Gold, Polymetal, Hochschild Mining and Lonmin rising strongly.FTSE 100 - RisersFresnillo (FRES) 994.50p +10.07%Vedanta Resources (VED) 1,126.00p +6.03%Randgold Resources Ltd. (RRS) 4,331.00p +5.51%Anglo American (AAL) 1,329.50p +4.85%Associated British Foods (ABF) 1,903.00p +4.85%Antofagasta (ANTO) 853.00p +4.73%Rio Tinto (RIO) 2,835.00p +4.63%BHP Billiton (BLT) 1,797.50p +4.41%Glencore Xstrata (GLEN) 265.25p +2.95%Eurasian Natural Resources Corp. (ENRC) 213.20p +2.45%FTSE 100 - FallersMeggitt (MGGT) 551.50p -1.87%International Consolidated Airlines Group SA (CDI) (IAG) 266.00p -1.41%Aviva (AV.) 364.30p -0.95%TUI Travel (TT.) 373.60p -0.74%Capita (CPI) 1,019.00p -0.68%Bunzl (BNZL) 1,383.00p -0.65%Morrison (Wm) Supermarkets (MRW) 280.30p -0.60%easyJet (EZJ) 1,328.00p -0.60%William Hill (WMH) 463.10p -0.60%BP (BP.) 466.75p -0.58%FTSE 250 - RisersAfrican Barrick Gold (ABG) 110.50p +12.35%Polymetal International (POLY) 517.50p +8.02%Ashmore Group (ASHM) 377.30p +7.31%Ferrexpo (FXPO) 158.00p +5.47%Hays (HAS) 99.85p +5.11%Lonmin (LMI) 287.80p +4.46%Supergroup (SGP) 844.00p +4.33%Premier Oil (PMO) 356.80p +4.27%Hochschild Mining (HOC) 154.50p +3.69%Xaar (XAR) 897.50p +3.52%FTSE 250 - FallersRank Group (RNK) 160.00p -2.44%Redrow (RDW) 239.30p -2.29%Anite (AIE) 132.20p -2.07%Informa (INF) 503.50p -1.76%esure Group (ESUR) 324.40p -1.70%Moneysupermarket.com Group (MONY) 200.20p -1.67%Dechra Pharmaceuticals (DPH) 689.00p -1.57%Savills (SVS) 604.00p -1.47%Keller Group (KLR) 1,058.00p -1.40%Tullett Prebon (TLPR) 343.00p -1.32%BC